Broad outlines for a compromise Medicare prescription drug benefit have been reached, although a number of contentious issues are being worked out, members of a House-Senate conference committee said. House Speaker Dennis Hastert (R-Ill.) told reporters that the plan would be unveiled in full by tomorrow. According to a draft of the compromise plan obtained by Modern Healthcare, seniors could buy prescription drug coverage for a monthly premium of $35 and a $275 annual deductible. Beneficiaries would have a 25% copayment from $275 to $2,200. Coverage would cease at $2,200 in total drug expenses until a beneficiary's out-of-pocket spending reached $3,600 (equivalent to about $5,000 in total drug expenses). Beneficiaries then would pay a modest copayment, perhaps $5 per prescription.
Seniors earning less than 135% of the poverty level with no more than $6,000 in personal assets would have a copayment throughout of up to $5. Seniors earning 135% to 150% of poverty with assets of no more than $10,000 would receive a smaller break on copayments. Sen. Edward Kennedy (D-Mass.) -- whose support was key to the passage of the Senate Medicare bill, which contained far more help for low-income beneficiaries than the possible compromise plan -- said earlier this week that he would find such asset tests "very troubling." On another issue, however, Sen. Charles Grassley (R-Iowa) said negotiators had reached a decision that would please Democrats and rural lawmakers who believe the government must guarantee prescription drug coverage in rural areas. Medicare would offer drug benefits through a federal backup plan if fewer than two private insurers offered freestanding policies, Grassley said.
The committee still was working on an incentive plan to retain employer-sponsored retiree coverage. Many employers have indicated they would consider dropping drug coverage for retirees if former employees were able to buy into a Medicare plan. Also on the table were provider issues, such as aid for rural hospitals and a larger inpatient update. The biggest remaining hurdle is "premium support," a provision that would force Medicare Part B to compete with private plans as of 2010 and that would set higher premiums for beneficiaries in traditional Medicare if the option proved more expensive than others. Sen. Olympia Snowe (R-Maine) said, "A premium-support plan that isn't just a demonstration would be a serious, serious problem for me."
Meanwhile, 40 Senate Democrats and a lone Republican have sent a letter to President Bush telling him that "a partisan conference report that jeopardizes Medicare and does not provide meaningful assistance to the elderly and disabled should not and will not pass. The bill must preserve a level playing field between conventional Medicare and HMOs and other private plans." Speaking at a press conference today, Senate Minority Leader Thomas Daschle (D-S.D.) said, "One great area of concern is the privatization of the Medicare program, including higher premiums for seniors. That is virtually a showstopper" for passage of the bill in the Senate. With four senators who voted against the Senate Medicare bill but didn't sign the letter, "we wouldn't need to filibuster. The plan doesn't have the votes to pass the Senate right now," Sen. Kennedy said. -- by Todd Sloane